Missed December 31 Income-Tax Returns Deadline? Here’s What to do Next

For those who have missed the December 31, 2023, deadline for filing their Income-Tax Returns (ITRs) for the financial year (FY) 2022-23 or assessment year (AY) 2023-24, there is still hope. They can still rectify errors and file the Updated Income-Tax Return (ITR-U).

The Income-Tax portal, updated by the Central Board of Direct Taxes (CBDT), facilitates the electronic filing of revised ITRs for FY 2022-23 or AY2023-24.

In the Union Budget 2022, the government introduced the ITR-U form for updating ITRs. The ITR-U is a form that allows taxpayers to correct omissions or errors on their ITRs up to two years from the end of the relevant AY to update their ITRs.

The ITR-U form is an option for an individual who has not filed their ITR or incorporated inaccurate and false entries while filing their ITR.

By availing the provisions of Section 139(8A) of the Income-Tax Act (ITA), 1961, taxpayers can rectify any errors or updates in their original return without facing legal action for incorrect information. A taxpayer has the chance to update the ITR within two years.

The calculation of these two years is considered from the end of the year in which the original ITR was filed. For example, for AY 2023-24, in case a taxpayer missed the revised or belated return filing window, they can file an ITR-U after the end of the assessment year, that is, March 31, 2024, but within two years from there, which is March 31, 2026.

It doesn’t matter whether a taxpayer has filed an original, belated, or revised ITR or has completely missed filing the ITR in a particular FY.

However, the ITR-U form cannot be filled in cases where an updated return has already been filed, for claiming a refund, for filing a nil return, and when an updated return results in lower income tax liability.

The taxpayer will need to pay additional taxes of 25% of the aggregate tax and interest due if the updated ITR is filed within 12 months from the end of the relevant assessment year. This additional amount of 25% of the aggregate tax and interest due is increased to 50% in case the ITR-U is filed after 12 months but before 24 months from the end of the relevant AY.

To file an ITR for both years, the taxpayer needs to be registered on the e-filing portal. There is no penalty for filing an ITR-U form. However, an additional tax shall be levied under Section 140B of ITA.